MALTA — The convenience store that recently opened on Guilderland Avenue in Rotterdam is one of many all-new stores for Malta-based Stewart’s Shops.
Some are replacing old shops on the same site or nearby, some are new to the neighborhood, and some seem inordinately close to other Stewart’s locations.
The new Stewart’s Shop at 2970 Guilderland Ave. joins four other corporate siblings ranging from 0.6 miles to 1.94 miles away. Someone craving a pint of a particular limited-edition ice cream flavor could hit all five shops with just 6.8 miles of driving.
Similarly clustered locations exist elsewhere within the 339-store chain, including three in western Niskayuna (maximum 2.3 miles apart) three in eastern Guilderland (2.1 miles), and three in northern Schenectady (1.3 miles).
The company has spent great effort in strategizing these locations, and has been spending roughly $50 million a year building or renovating shops, spokeswoman Erica Komoroske said.
The close proximity of some of these shops might suggest that one Stewart’s will poach sales from another, but they are often on different through-routes, or on opposite sides of major turning points of the same route. So a typical motorist is unlikely to pass more than one or two of the Stewart’s Shops in Rotterdam on the same trip — unless, say, they were specifically looking for that one ice cream flavor.
Other considerations that factor in, Komoroske said, include whether a location will target commuters passing through or residents who live nearby, and whether the surrounding community is growing or has reached full build-out.
“Stewart’s is really good at real estate — [we] know where we will do well,” she said.
How big a new store is depends on other factors — Komoroske said the replacement will generally be larger “where the store is doing really well and the community supports it and there’s land available.”
Usually but not always, the new stores will have gas pumps in front. Fuel sales remain a critical part of the convenience store industry’s business model, even amid decreased demand through the pandemic.
Those are the considerations in densely populated areas.
Rural areas have different parameters. Stewart’s is building a series of new stores with more square footage and offering features such as fresh produce or community meeting rooms in the North Country because there are fewer retail options there.
The new Stewart’s in Indian Lake for example totals more than 4,000 square feet, which compares with 2,500 square feet for the previous generation of stores and 3,600 for new stores in more densely populated areas. The next closest gas station to the Indian Lake shop is 17 miles away, Komoroske said.
In a Schenectady neighborhood that has more residents than all of Hamilton County, Stewart’s is planning to demolish its existing shop and a neighboring hardware store and build a bigger store with gas pumps.
The existing Stewart’s at 1757 Van Vranken Ave. has a steady stream of customers arriving on foot and by vehicle and is one of the few grocery options in a neighborhood with no supermarket.
The company’s decision to increase the average square footage per store is in large part driven by the need to make room for a larger inventory of prepared foods, Komoroske said.
“We were seeing a trend in the food-to-go offerings,” she said.
In 2019, food-service sales accounted for 25.4 percent of convenience store sales excluding gasoline, trade association NACS reported.
The long-running modernization campaign hasn’t been all new, all upwards for Stewart’s. Small or underperforming stores in Albany, Amsterdam, Ballston Lake and Guilderland have been closed in recent years and not replaced. On Sunday, the company shut down a small Route 50 shop in Burnt Hills that was less than a mile from the big circa-2019 shop at Lake Hill Road.
Meanwhile, competitors are not sitting still. Massachusetts-based Cumberland Farms, with more than 550 stores, has built numerous new stores across the region in recent years, some of them larger than the largest Stewart’s Shops.
The COVID pandemic this year put a crimp in Stewart’s construction plan.
Stewart’s had planned to spend $75 million on infrastructure in 2020 to mark its 75th anniversary. But construction work was halted in the spring, and took time to restart. Only 19 stores will be completed this year, as some projects were pushed back to 2021.
More than 20 stores will be rebuilt or replaced in 2021, Komoroske said.
Albany, Ballston Spa, Castleton, Gansevoort and Glenville are the last places that will get new stores in 2020.
The final capital budget for this year will be more than the $50 million average of past years but well short of the $75 million target for 2020, Komoroske said — even with a $5.5 million, 65,000-square foot warehouse expansion and the acquisition of Polsinello Fuels’ distribution business and its five gas stations.
At the end of 2019, Stewart’s had 336 shops and was the 29th largest convenience store operator in the nation, down from 27th at the end of 2018, according to the annual report by Convenience Store News.
BY THE NUMBERS
Convenience stores rank among the most prolific retail shops in the United States, and range from massive corporate chains to mom-and-pop operations with a few shelves full of goods in their single location.
After a long period of growth, their numbers contracted slightly in the last two years. Often-cited pressures on the industry include decreasing tobacco and fuel sales and increasing competition from dollar stores or fast food chains.
Here are some statistics compiled by NACS, a trade organization for the convenience store industry:
— The number of U.S. convenience stores slowly increased from 144,541 at the start of 2010 to 154,938 at the start of 2018, then dropped to 152,700 at the start of 2020.
— Of those 152,700 stores, 121,988 sold vehicle fuel.
— Those fuel sales totaled $396 billion in 2019, with an average price of $2.57 per gallon and a pre-expense profit margin of 25.82 cents per gallon; these sales accounted for 80 percent of the vehicle fuel sold in America.
— In a recent survey, 58 percent of responding store operators saw inside-of-store sales increase from January through September 2020 and 74 percent saw a decrease in outside-of-store sales — fuel.
— The biggest share of in-store sales were tobacco (34.4 percent), prepared food/dispensed beverages (25.4 percent) and packaged beverages (14.8 percent).
— New York, fourth-most populous state in the nation, also had the fourth-most convenience stores: 8,489.
— Convenience stores employ 2.31 million people and complete 165 million transactions per day.
— Average full-time employee wage in 2019 was $11.75.
— Employee turnover rate in 2019 was 121 percent.